Justice Cresswell ruled in favor of Lloyd's in Lloyd's v Jaffray and Jaffray's counterclaim of fraud. Although the result is not undexpected, it is regrettable that the British Names were not able to prevail. Because of the 1982 Lloyd's Act of Parliament, however, Lloyd's enjoys special immunities in the English courts. These immunities significantly narrowed the standard of review applied by the judge in Jaffray. Consequently "bad faith" was the only act that would have constituted fraud in Jaffray, and the court concluded that this higher threshold was not crossed by Lloyd's. In stark contrast to American courts, the Names did not have the option to have the case heard by a jury. Nor did the court allow Names' counsel to compel witnesses to submit to cross-examination.

The following links are to large sections of the decision, in the same format as it was downloaded from "www.courtservice.gov.uk." The complete decision is over 250 pages long.

Judgment
Section One - |- Section Two - | - Section Three - | - Section Four

Appendices
Appendix One - | - Appendix Two - | - Appendix Three - | - Appendix Four

To access the subheadings of the Table of Contents of Cresswell's decision, click on this link.

Royal Courts of Justice,
Strand, London WC2
3 November 2000

Before:

THE HON. MR JUSTICE CRESSWELL

BETWEEN:

	THE SOCIETY OF LLOYD'S	Claimant and Defendant to Counterclaim
	and
	SIR WILLIAM OTHO JAFFRAY BT	Claimant by Counterclaim

Mr. Charles ALDOUS Q.C., Mr. Richard JACOBS Q.C., Mr. David FOXTON and Mr. Stephen HOUSEMAN (instructed by Freshfields Bruckhaus Deringer) for the Society of Lloyd's.

Mr. Simon GOLDBLATT Q.C. and Mr. Vincent NELSON (instructed by More Fisher Brown) for certain members of the United Names Organisation.

Mr. Patrick TALBOT Q.C., Mr. David DRAKE, Mr. David CRAIG and Mr. Giles RICHARDSON (instructed by Grower Freeman and Goldberg) for other Names.

Sir William Otho JAFFRAY Bt. and other Names appeared in person.

JUDGMENT

I direct that pursuant to RSC Order 68 r. 1 no official shorthand note shall be taken of this judgment and that copies of this version as handed down may be treated as authentic.

The Hon. Mr. Justice Cresswell

Dated: 3 November 2000

CONTENTS, TABLES AND APPENDICES

CONTENTS

1. Headnote

2. The Impact in Personal Terms

3 Glossary of Terms Abbreviations/Acronyms

4. The Scheme of the Judgment

5. The Lloyd's Litigation

6. Proceedings against Lloyd's in Other Jurisdictions

7. The Threshold Fraud Point. The Names' Case

8. Lloyd's Case

9. The Relevant Legal Principles

10. The Administrative Structure and Governance of the Lloyd's Market

11. The Regulatory Background for the Auditing and Accounting Regime at Lloyd's

12. The Rules and Procedures Governing the Admission to Underwriting Membership of Lloyd's and Related Matters

13. RITC - Some General Principles - The Role of the Managing Agents/Underwriter

14. RITC - The Role of the Auditors

15. The Witnesses

16. An Overview of the Nature and Development of Asbestos-Related Claims

17. Differing Views as to the Likely Outcome of Asbestos- Related Claims. The Writing of Run-Off Contracts

18. Open Years

19. The Years in Question. 1978 to 1988

20. 1989 and Subsequent Years

21. Developments in Relation to Capital Structure

22. Analysis of and Conclusions as to the Threshold Fraud Point

23. E & O Cover at Lloyd's

24. The Market Scandals. The Failings Revealed by the Lloyd's Litigation

25. Conclusions.

TABLES

Table 1 The Closure of Years - RITC; Lloyd's Global Accounts; Joiners.

Table 2 The Growth in the Number of Asbestos-Related Personal Injury Claims.

Table 3 Outhwaite Run-Off Contracts

APPENDICES

1. Lloyd's Litigation (and Related Litigation). List of Cases

2. List of US Cases Concerning Coverage for Asbestos Losses for the Period 1978-1988

3. The Chronology of Certain Information Relevant to Asbestos- Related Claims for the Period 1978-1988

4. Production of the SSOB, Aggregate Results and the Global Accounts, the Development of Globals and the Process for the approval of SSOB and Globals